A conversation with… Randy Merren

Few people have been in the Cayman Islands media and entertainment business as long as Randy Merren.

Back in 1992, Merren’s company Hurley’s Entertainment launched the radio station Z-99, Cayman’s first privately owned commercial radio station. Based on a U.S. rock station format, Z-99 quickly earned a major market share with its only competition being the government-owned Radio Cayman and the International College of the Cayman Islands’ station, ICCI-FM.

A decade later, in March 2002, Merren launched the country radio station Rooster 101, which eventually added the morning talk radio show, “Cayman Crosstalk.” Although many more radio stations have launched since – Cayman now has 14 stations – Z-99 and Rooster 101 still command a major market share.

Merren said there was some initial advantage to being the first commercial radio stations in Cayman, but that’s not what sustains them these days.

“I think we’ve just done a good job,” he said. “We’ve got probably the best two morning shows on the island with ‘Crosstalk’ and the ‘Morning Zoo’ with Jason and Katie. And then we have a full complement… behind it.”

One thing the Hurley’s Entertainment stations do that many others in Cayman don’t is have all of their shows produced by people who are on the ground here.

“A lot of [the shows on other stations] are just voice tracked,” he said, adding that by having his shows produced here instead of in the U.S. or elsewhere, people have familiarity with the on-air personalities.

“It’s all done here locally, so people can identify who our jocks are,” he said. “When you say Z-99, they can reel out who the jocks are on that station, same way with ‘Crosstalk.’”

Talk radio

“Cayman Crosstalk,” the weekday morning radio talk show, is extremely popular, especially with Caymanians interested in politics and government. The shows features a steady stream of guests, many of them politicians, and also takes on-air calls from listeners.

“Anywhere you go, people are talking about something that happened on that show,” Merren says. “The government listens to it, you know that. Most of the elected members are in there every week.”

Merren said the idea behind “Cayman Crosstalk” was more than just making money.

“It’s something the country, I think, needed,” he said. “The driving factor behind it was we wanted people to be educated about what was going on in the government, what really was happening. That’s why it came about. We do have some other segments… to try and help with revenue, but at the end of the day, it’s there to basically educate people about what’s going on in the country.”

The politically-driven show can sometimes get controversial, but Merren said he doesn’t get involved with the content and allows the show hosts – currently Austin Harris and Jonathan Piercy – to conduct it the way they see fit. Occasionally, he gets letters or telephone calls of complaint, but not too often.

“[People] know I don’t really get involved, so I think they’ve figured it out that the show goes where it goes,” he said, adding that he’s fine with that as long as the hosts get the facts right about whatever they’re talking about.

Merren said he thinks long-standing host Harris has made great strides in the position.

“I think he’s done a great job,” he said. “I think he’s more abreast… and has a better grasp of the topics. He does a lot of reading, does a lot of studying. I think he’s realized he’s got to do that. People expect him to know.”

Because “Crosstalk” is a politically-driven show, the hosts tend to be people with political aspirations. Former show host Ellio Solomon used the show as a springboard for a successful election campaign for a seat in George Town in 2009. Current host Piercy unsuccessfully ran for election in George Town in 2009 and 2013, prior to his coming on as co-host of “Crosstalk.” Harris has been involved with political campaigns before, and has been the subject of speculation when it comes to his political aspirations. Merren said he doesn’t have a problem with his hosts using “Crosstalk” to further such aspirations.

“You build your brand, which is your name, so when it goes to the polls, they… know that brand,” he said. “Especially the younger people; how much do they really pay attention to politics, but they’re still asked to go out and vote. But they know that branding.”

C3

Earlier this year, Merren entered into the entertainment and communications business in another way, with the launch of C3, Cayman’s new television, Internet and telephone service provider. One focus of C3 is local-based customer service in contrast to other telecommunications companies in Cayman, which are outsourcing some of their customer service operations to call centers in other jurisdictions.

“For us, we’ve got to be local,” Merren said. “Our customers know us. There was a time when you knew everybody at LIME. You knew the [managers],,,they were all local guys. Now, who are you calling? Are you calling Ericsson, or are you calling LIME or are you calling [British Telecommunications] – I’ve even seen BT down here doing work. You still call [a local] number, but who are they sending to service you?”

C3’s other main focus is fiber-based technology, something which produces far superior clarity of signal.

“It’s an exciting time because the consumers… didn’t realize what they were missing until they started to see what they have now and what fiber coming into your home can actually do.”

C3 has also made the investment to have its head end – the facility that receives the television signals prior to distribution – located here in Cayman, a decision which required the installation of a series of large satellite dishes.

“We wanted to make sure we had the best possible… quality of content going out on our network,” Merren said. “We bring [the signal] in and just push it through a system back out to the consumer. We didn’t want to bring it from California, which is where I think some of our competitors are actually doing it – all the way down, fiber to here – that’s a long hop for content and everything else.”

So far, C3 has only rolled out service in George Town, but eventually it wants to expand its service island-wide.

“We’ve crossed about 5,000 homes I think,” Merren said. “We’ve got about 500 subscribers, some of those are bundles, some are not, some have TV, some have internet.”

Merren said he’s happy with the figures, but admits that the take up has been slower than anticipated.

“It’s a longer transition,” he said. “It’s a little tougher to get people to move. There are a lot of contracts in place with Logic, with WestStar, where we have to sit and wait [for the contracts to end].”

WestStar sale

Logic Communication’s purchase of WestStar, which was finalized in early September, will have significant effects in the Cayman market, but Merren said he expected it.

“We knew some consolidation was going to happen in the market. WestStar definitely had to do something. They weren’t out on the poles and they couldn’t continue to build on the ground,” he said, noting that the cost of building out fiber-to-home on the ground is significantly more expensive. “So they were going to be involved with something. They were already in partnerships in Bermuda – some kind of [joint venture] on a telecoms or a cable company over there – so it made sense.”

The buyout of WestStar effectively eliminated one of the competitors, even if it did create a larger one. As for C3’s other competitor, Merren said he’s not sure how committed LIME is to television.

“I don’t know what their long-term plans are. They don’t seem to be doing much with the TV now and all their focus is doing basically broadband and their [telephone service]. They still have customers, but you don’t see [LIME TV] in their promotional material. It’s not something they’re doing a lot with. I think they have one HD channel. We have over 70 now and counting.”

Unlicensed content

A positive development from the sale of WestStar from Merren’s point of view is that Logic will cease the practice – which WestStar was doing and it wasn’t – of selling unlicensed content, he said.

“They have a lot of channels, like the HBO channels, that… they’ve got to take them off,” he said. “I met with HBO and they said it was happening. “

WestStar used unlicensed content taken from U.S. satellite feeds, a practice which is not currently against the law in the Cayman Islands. In some cases, such as with HBO, WestStar could have licensed content through HBO Latin America, but chose not to, citing the fact that HBO Latin America’s feed included several Spanish-speaking channels, whereas the feed it was getting from the U.S. did not.

“That’s an issue we’re all going to be faced with because we don’t have access to all the channels,” Merren said. “Not all the channels we’re going to be licensed for are going to be the… U.S. feed.”

Regardless, Merren believes it’s best to use licensed content.

“I firmly believe that if a channel is licensable in the Cayman Islands, you shouldn’t play it unless it’s licensed,” he said. “Now, you have a… gray area, which is done through all of the rest of the Caribbean and Latin America and different places, with these channels that are there – Showtime for instance – that will never be licensed. So you make a business decision – do you carry those channels or not? We made the decision that we were going to stick with licensed content.”

“The last thing I want to do is get our local investors – this is all local investors, there’s no foreign investors in there – we didn’t want to go in there and be involved with the companies [using] illegal content and if something goes wrong… lawsuits. We didn’t want that for our investors,” he said. “Now if you did it, your profit margins are a hell of a lot better because you’re not paying on a per [subscription] basis, you’re paying for a channel… whereas we pay on a subscriber fee, based on subscribers with minimums and all that stuff. So it would have been more profitable on one side, but you have to assume the risk.”

In addition to WestStar, the Dish Network and Direct TV were both providing unlicensed content, something Merren said he understands HBO is going to tackle, but he believes Cayman’s Information and Communications Technology Authority could also easily address.

“I think the ICTA could have easily said as a regulator to them, hey, you’re licensed by us, you can only carry the channels that are licensable… if you’re carrying channels that are licensable that are not licensed, take them off, and then the channels that are licensable, pay – that’s your call to do. That would have been fair.”

Merren believes the ICTA needs to be more assertive going forward.

“The regulator needs to start regulating and making sure everyone is playing by the same [rules],” he said. “If they do that, it forces them to take a look at [the unlicensed content of] satellite TV. [Satellite television companies] are selling a service which is just like ours, TV service.”

Merren said Cayman’s satellite television providers will argue that their network doesn’t exist here as rationale for not having to be licensed in Cayman and pay the 6 percent regulatory fees to the ICTA that C3 has to pay.

“Yeah, the network exists here,” Merren said in disagreement. “You have a satellite that’s bringing it down, that’s where the network starts; the network starts here – it’s a head end in the sky if that’s what you want to call it – you’re grabbing that content and putting it through. As far as I’m concerned, it’s licensable.”

Regulating such situations is exactly what Merren believes the ICTA should be doing.

Being the owner of the radio station that airs “Cayman Crosstalk” isn’t the extent of Merren’s political activities; he is also one of the founding members of the Coalition for Cayman, better known as C4C. The group endorsed seven candidates in the 2013 general elections, with three of them – Tara Rivers, Roy McTaggart and Winston Connolly – gaining seats in the Legislative Assembly.

Merren said he was happy with the result.

“I think it accomplished what we wanted it to do,” he said. “We wanted to get some talented Caymanians elected. We got three of the candidates got elected.”

Although the C4C candidates ran as independents, those elected ultimately chose to join the government, rather than being opposition.

“I think it was a better move, joining them,” Merren said. “They can still effect change from there. If you sit on the back bench, what are you going to accomplish? You can… make a lot of noise.. but now at least they can vote, they can be part of caucus, they can be alert and I think it’s better.”

Merren said the C4C candidates have learned that what politicians want to happen in government and what can actually happen are two different things.

“But overall, I think the government is doing a great job,” he said. “People say they’re not doing this or that, but you know what, I think the economy is on stronger ground, I think you don’t hear some of the language you were hearing before about corruption and all that stuff that was going on. That… has all gone away. In my book, there’s nothing worse than hearing the word ‘corruption’ in your country.”

Merren believes C4C still has a role to play.

“But we’re not a political party. That’s what people keep thinking,” he said. “We were just some individuals who wanted to see some change and get some people to run. But I think the party system is here and is dug in like a tick now and isn’t going to leave. I think C4C will continue to be an advocacy group that will continue on.”

As for the criticism that C4C only represents the interest of big business, Merren said he doesn’t consider himself big business, but acknowledges that the money of big business plays a role in any successful campaign.

“To do anything with politics, there has to be money behind it,” he said. “Big business is involved in all of it. Someone had to do it, I guess. We did it, we got some stuff accomplished and I think the country is better for it, even if we haven’t won everything we’ve done and we haven’t done everything right.”